Economic Theory vs Economic Reality

Economic Theory

  1. A sliding dollar is good for the economy, it will boost exports.
  2. The dollar is overvalued and needs to be “right” valued.
  3. Our debt to GDP Ratio is down.
  4. Our Fiscal deficit is down.
  5. Jamaica has passed all four IMF test
  6. The economic indicators are looking very good
  7. Portia is the best person to implement the IMF program
  8. When we have complete 4 yr program, Jamaica will see massive economic growth.
  9. IMF is pleased with the Jamaican Government
  10. Job creation should  occur


Economic Reality

  1. Exports are down 34% and the country is poorer than before.
  2. The dollar is being “right” valued and prices are flying through the roof as the dollars searches for the correct value.
  3. Our debt stock is rising and we are not earning enough to pay back these debts.
  4. GOJ owes billions of dollars that are not on the books
  5. Suppliers and workers are owed over $54B , which is putting many of these business at risk of closing.
  6. The prices of goods and services continues to rise on a weekly basis, people can barely survive.
  7. Worst Prime  Minister this country has ever seen, is best to lead the country down the road of  poverty.
  8. There is no growth plan, we hope growth will happen at the end of the program. Business and consumer confidence continues to sink and more and more Jamaicans are seeking to get the out of what is fast becoming a hell hole.
  9. The people of Jamaica are getting poorer and poorer by the day and are now scavenging to survive, there is growing anger with the GOJ and the IMF.
  10. Workers are being sent home on a daily basis.


Jamaica has indeed doing well !

2 Responses

  1. Dr Damian King said it right on Nationwide with Cliff Hughes we need to stay the course to recover the economy as if the economy is a living breathing person. BOOK ECONOMICS HAS NEVER WORKED IN JAMAICA AND THESE TEXT BOOK ECONOMISTS HAVE DESTROYED THE COUNTRY. They are focussing on numbers and GDP and percentages so while we are correcting the macro variables the people are dying.Hooray we passed all the IMF tests but where are the businesses which will grow the economy where will the revenues come from to pay taxes. I am gone with my family. Last person out close the door please

  2. For the period 1970 to 2005, the Jamaican dollar devalued by an average annual rate of 212 .6 per cent. For the same period, real GDP grew by an average annual rate of 1.5 per cent. Over the same period, the Barbadian dollar remains constant at BDS$2 to US$1. As highlighted by Witter then, and is even more conclusive now, devaluations have failed miserably to stimulate exports, contain growth in imports and to significantly reduce balance of payments deficits. Devaluation has automatically driven up local prices and erode real fixed incomes, thereby undermined the domestic market. Devaluation has not addressed our production crisis and its attendant social problems. Devaluation is blinded to the inelasticity of imports demand due to our import dependence of production and consumption. Also, devaluation is insensitive to the speculative tendencies which derive from investor’s lack of confidence in the productive sectors.

    The overused and deliberate strategy by our macroeconomic policy decision-makers must not be allowed to continue. We can no longer ignore it. Instead, we must shake the administration out of its complacency towards devaluation. Data suggest that devaluation has consumed our resources, to the point where the economy is characterised by “its either this or that”, and like our CARICOM partners, our economy should be characterised by “complementarity”.

    This was 2006 and 8 years later we are still writing the same message ” stay the course”.

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